September 27, 2021

OsoyoosToday

Complete Canadian News World

The purchase of Kansas City South builds the first train connecting Canada, the United States and Mexico

Reuters.- Canadian Pacific Railways signed a $ 27.2 billion cash and stock agreement to buy Kansas City South Wednesday after Canadian National Railways agreed it could not save its own $ 29.6 billion deal to US Railways.

The connection will form the first direct rail link connecting Canada, the United States and Mexico, with a network of approximately 32,000 kilometers and an annual revenue of about 8.7 billion.

The cash and stock deal for the Canadian Pacific is $ 300-a-share higher than the $ 275-share cash and stock deal it won in March to buy Kansas City South.

The deal was canceled in May when the Canadian National negotiated with Kansas City South for $ 325 in cash and a share offer.

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Shares of Kansas City South traded slightly lower at $ 281.55 in trading in New York today.

The Canadian National won last month when the U.S. Surface Transportation Board (STB) rejected a temporary “voting trust” structure that would allow Kansas City South shareholders to obtain without waiting for full regulatory approval of the agreement.

Canada Pacific has received approval from the STB for its proposed Voting Trust, so Kansas City South shareholders will receive $ 300 in cash and shares, even if the regulator rejects the deal.

The regulatory commitment it provided led the Kansas City South board of directors to switch to a contract with the Canadian Pacific.

The Canadian National Kansas City Hedge Fund has faced some pressure from its investors, including DCI Management Limited, to abandon its attempt to buy the South.

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Canadian National shares rose 3.7% to C $ 150.97 as its investors expressed relief at the abandonment of the contract attempt.

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